Google has formally called on Britain’s antitrust regulator, the Competition and Markets Authority (CMA), to take action against Microsoft, accusing the tech giant of engaging in business practices that place competitors at a significant disadvantage. This move comes as Microsoft, along with Amazon, faces increasing global scrutiny over its dominance in the cloud computing industry.**
The CMA initiated an investigation into Britain’s cloud computing industry in October, prompted by a referral from media regulator Ofcom. The investigation highlighted Amazon and Microsoft’s substantial control over the market. In 2022, Amazon Web Services (AWS) and Microsoft’s Azure collectively held a 70-80% share of Britain’s public cloud infrastructure services market, while Google’s cloud division lagged behind with approximately 5-10%.
Google alleges that Microsoft’s licensing practices create an unfair playing field by discouraging customers from using rival services, even as secondary providers alongside Azure. In a letter submitted to the CMA, Google claimed that customers were economically compelled to use Azure, despite potentially preferring competitors in terms of pricing, quality, security, innovation, and features.
According to Google, Microsoft’s licensing restrictions constitute a significant barrier to competition in Britain’s cloud computing market and directly harm customers. Google’s submission to the CMA outlined six recommendations, including the improvement of interoperability for customers using Azure alongside other cloud services and the prohibition of withholding security updates from those switching providers.
Microsoft updated its licensing rules in the previous year to address concerns and foster competition. However, Google argues that these changes did not go far enough to satisfy competitors. A Microsoft spokesperson responded by stating that the company had collaborated with independent cloud providers to address concerns and promote competition, with over 100 providers worldwide taking advantage of the changes.
Google Cloud Vice President Amit Zavery criticized Microsoft’s practices, emphasizing Google’s commitment to a multi-cloud approach that allows customers flexibility in choosing providers based on their needs. Zavery highlighted Microsoft’s decision to update terms related to using software licenses in the cloud, resulting in higher costs for customers opting for Google or AWS over Microsoft’s Azure.
As the CMA reviews Google’s claims, the ongoing scrutiny of major players in the cloud computing industry underscores the growing regulatory attention towards ensuring fair competition and preventing monopolistic practices. The CMA has not yet issued a response to Google’s submission.